Will Saudi Arabia Use Its Economic Relationship With Russia To Broker Syria Deal?

As Russia continues to assert its position in the Middle East with more airstrikes in Syria, Saudi Arabia -- America’s longtime and wealthy ally -- finds itself in a precarious position. After offering Russia $10 billion in financial investments and expressing interest in purchasing Russian weapons, Riyadh must now decide whether it will look to continue this burgeoning economic relationship or try to use it as leverage against Moscow in Syria.

Saudi Arabia has long stood at odds with the Russian position of propping up the regime of Syrian President Bashar Assad. But with Russian airstrikes, low oil prices and a strained relationship with the U.S. following the Iran nuclear deal, experts say Saudi Arabia can’t afford to ignore Russia’s increasing involvement in the region.

“They [Saudi Arabia] are trying to find their way in a more complicated world than they are used to,” said Richard Murphy, a nonresident fellow at the Middle East Institute based in Washington, D.C., and a former U.S. ambassador to Saudi Arabia and Syria. “There’s still a suspicion in Riyadh about Moscow.”

Saudi Arabia has been quick to voice its displeasure over the Russian airstrikes in Syria that started on Sept. 30 and have mostly targeted opposition groups instead of the Islamic State group, also known as ISIS. Saudi Arabia has backed the United States' stance to remove Assad from power after decades of turbulent relations between Riyadh and Damascus over issues ranging from religion to geopolitics in the region.

“The delegation of my country expresses its profound concern regarding the military operations that Russian forces have carried out in Homs and Hama today, places where ISIS forces are not present,” said Saudi Ambassador Abdallah Al-Mouallimi, speaking at the United Nations last week. “These attacks led to a number of innocent victims. We demand it stop immediately and not recur.”

Prior to the airstrikes, relations between the two oil states had started to warm. Russian President Vladimir Putin met with defense minister and deputy crown Prince Mohammed bin Salman over the summer and signed six agreements, including one regarding nuclear technology, Al Arabiya reported. Saudi Arabia committed to invest $10 billion in Russia’s Direct Investment Fund in July, and in August, Russian media reported that the Saudis had expressed interest in purchasing the Iskandar missile system from the Russian army.

The closer relationship surprised many after years of antagonism, with Moscow blaming Riyadh for supporting terrorism in areas such as Chechnya.

“The Russians and Saudis have occasionally shared interests and worked together, but overall it’s more of a rivalry,” said Firas Abi Ali, a senior manager of country risk in the Middle East and North Africa at IHS, a global economics and risk analysis firm.

Saudi Arabia’s commitments to Russia have mostly been promises, and Saudi Arabia’s long dependency on Western weapons brings into question how Russian technology would fit, Ali said. “The Russians haven’t received anything concrete from the Saudis,” he said.

That means that the defense contract promises could be used to influence talks regarding Syria. The weapons deal could be used for “rewarding the Russians for some increased tone or moderation in the Russian position,” said Paul Schwartz, a senior associate in the Russia and Eurasia program at the Center for Strategic and International Studies based in Washington. “Saudi is playing what they have to offer as a carrot to influence Russian behavior. It’s a close call which way it will go.”

Another potential avenue for Saudi Arabia to explore nudging Moscow could be an oil price increase by coordinating production levels. Russia has suffered from an economic downturn since the U.S. and EU lobbied sanctions over its actions in Ukraine, particularly in light of the global drop in oil prices to below $50 in January.

Russia annexed the Crimean peninsula in March 2014 and has backed separatists fighting Ukrainian government troops in eastern Ukraine. The Russian government has continued to deny any direct military involvement in Ukraine as sanctions have continued to hold. Both Russia and Saudi Arabia depend heavily on oil to drive their economies.

“What they [the Russians] see happening is the Saudis are bringing the price of oil down to undermine Russia,” said Anna Borshchevskaya, an expert on Russian policy in the Middle East at The Washington Institute for Near East Policy.

Despite Saudi Arabia’s displeasure over the U.S.’s backing of the Iran nuclear deal and a revised defense doctrine that underscores the diminishing role of Western states in the Middle East, experts said the U.S. has proven to be a long-term friend for to Riyadh. The Iran deal brokered between the U.S., Tehran and other world leaders, including Russia, will lift sanctions on Saudi's regional rival and has raised fears over Iran potentially enriching uranium to create a bomb.

Even with the Iran deal, Riyadh was still likely to look to the U.S. for guidance. Saudi Arabia could elect to take a middle road with Moscow and wait to see if airstrikes continue and spread in the region.

“They [Saudi Arabia] don’t move with a great sense of urgency on most issues,” Murphy said. “It’s up for grabs to see how Syria plays out.”